Business Value Narrative
Business Value: The Secret to B2B SaaS Applications Growth
I believe that the process of value creation is more than a financial return-on-investment calculation, it's about how a a B2B SaaS solution can be applied with a degree of certainty. It's a helpful story.
Across the globe, large enterprise CEOs are eager to capitalize on new digital business models. Yet, McKinsey research shows that while 90 percent of companies have launched some flavor of Digital Transformation, only a third of the expected revenue benefits, on average, have been realized.
The Challenge: IT organizations often lack the digital or cloud skills needed to build a solid business case and an execution plan that ensures transformation success. Some CEOs turn to management consultants for guidance. Some CIOs solicit aid from their IT vendor partners.
Enterprise leaders are seeking help from skilled practitioners. Are you a trusted advisor?
The Opportunity: enterprise IT vendors and software providers should be prepared to help buyers. Business-to-Business (B2B) SaaS firms must gain the expertise to communicate business value. They must change and evolve their traditional Go-to-Market approach. So, why change now?
More IT investment projects receive scrutiny by the enterprise CFO. New cloud projects are often assessed based on their alignment with previously approved strategic imperatives for digital growth. One method to do this successfully is by creating a concise Business Value Narrative for each project.
A Business Value Narrative communicates the benefits of the cloud SaaS offering in a way that is directly relevant and compelling for customer stakeholders. It should focus on the specific issues that your offering solves, and (most importantly) the tangible results that will deliver a business outcome.
When done well, a Business Value Narrative can:
Increase awareness of your SaaS solution
Generate sales leads and increase revenue
Differentiate your offer from your competitors
Build trust and credibility with decision-makers
5 Tips for Effective Business Value Narratives
If you're not sure how to describe Business Value, start here:
Identify the key benefits of your solution, from the buyer’s perspective.
Focus on the big challenges or opportunities that your offering solves.
Use concise language that translates into desired business outcomes.
Quantify the probable results that you can deliver for your customers.
Test your narrative with current and potential customers to get feedback.
The method that I use to complete each of these tasks starts with my researched business value hypothesis. A cloud SaaS value hypothesis is a statement about how a change in the organization's digital capabilities will impact its desired business outcome. It is a testable assumption that is used to guide the project and measure success.
Researching a Business Value Hypothesis (BVH)
A Business Value Hypothesis (BVH) describes how a customer’s organization will benefit from using a SaaS application. In my experience, it’s applied to align with business value metrics that help the buyer rationalize their investment in your SaaS app and assess the realized value performance after implementation.
Step-by-Step Guide to Creating a BVH Framework
The basic idea for a BVH is simple. Yet, most IT vendors typically don’t have a systematic approach to develop a comprehensive hypothesis. Here is my proven guide on how to create a Business Value Hypothesis for B2B SaaS applications:
Identify the key business issue(s) that the SaaS solution can solve.
The first step is to identify the business challenges or opportunities that the SaaS application will help to resolve. This could be an issue that is costing the business time, money or other resources. For example, the problem could be that the business is unable to process online orders quickly enough, or that it is not able to keep track of its available inventory accurately.
Quantify the burden of the issue(s). Emphasize the perils of inaction.
Once you’ve identified the business issue, you must quantify all associated impacts. This means estimating the total negative costs of the issue; the fully-loaded financial burden. For example, if the problem is that the business is unable to process orders quickly enough, you would need to estimate how much potential revenue or profit the business is losing over time.
Qualify the proven benefits of the SaaS solution. Highlight examples.
Next, describe the business benefits enabled by the SaaS application. This means estimating how the SaaS app will empower leaders of the business, and intended end-users, to adopt the solution and achieve the desired outcome. For example, if the SaaS application will enable them to process more online orders, you would need to explain how this is done. Offer prior customer case study examples.
Calculate the return on investment (ROI) of the customer project.
The next step is to determine the most likely ROI of a best-fit solution. This means dividing the benefits of the solution by the purchase cost of the SaaS app. For example, if the applied benefits of the app are $100,000, and the cost of the app is $50,000, then the estimated ROI would likely be around 200 percent. Note, that this is an approximation, not a performance guarantee. Besides, value creation assessment isn't merely a financial calculation.
Craft a compelling value story that aligns with a strategic imperative.
The final step is to use the initial and ongoing discovery dialog with the customer project sponsor, and other key stakeholders, to co-create a thought-provoking proposal that will align – whenever possible – with one of the C-suite’s high-priority big bets. For example, if the project value is aligned with streamlined order processing, then brainstorm the most effective way to communicate how the desired business outcome is highly probable, given prior experience with similar companies in the same or closely related industries.
Your BVH narrative is an evidence-based approach to gain consensus and enable the buyers to reach a decision. The customer project sponsor must own this process. You are there with helpful support.
Why I Recommend BVH Customization
Creating a fully customized BVH narrative is an important task in the process of helping buyers evaluate, select, justify and implement a relatively risk-free SaaS solution. Yes, this process requires significant effort on the part of the IT vendor, and the customer buyer’s committee. And no, you can't shortcut any steps in the process.
However, you can apply Generative AI tools to help you automate the steps, drive the decision-making process toward completion, and thereby reduce the likelihood of any post-deployment buyer regret.
By following all the required steps, you can create a BVH that will enable customers to make informed, lasting decisions about your SaaS solution. Besides, you'll avoid procurement "no decision" outcomes.
So, let’s summarize the BVH keys to success:
Be specific. When quantifying the costs and the business benefits of a SaaS solution, be as detailed as possible. This will help you create a more accurate and credible BVH.
Be realistic. When estimating the time and effort required to achieve the desired business outcome, be pragmatic. This will help you to create a BVH that’s believable.
Be honest. When describing the customer IT and LoB staff commitment required for success, be very truthful. This will help you create a trustworthy business partnership.
Secret Revealed: Value Creation Matters
As a cloud-based SaaS solution provider, you know why your offering can be the best-fit for each customer. But can you convince senior business decision-makers (the ultimate buyer) to appreciate your value proposition?
That's where I come in. I can coach you on how to make your B2B cloud SaaS offering relevant and appealing to the most discerning buyers: Line of Business (LoB) leaders and their C-suite executives.
I'll help you codify the business outcome needs of your typical buyer profile and develop a messaging strategy that speaks to them directly. I'll also show you how to position your offering as the solution to their high-priority challenges and opportunities (e.g. C-suite committed strategic imperatives).
So, why change? Why now?
Your customer buyer's committee of diverse stakeholders may not have the skills, prior experience or available time to fully research and create a compelling business case for your project. Moreover, the client CIO and CFO will appreciate you sharing actionable and credible information or guidance.
Do You Need Help? Reach Out
If you're ready to take your SaaS business revenue growth to the next level, then I encourage you to seek qualified help. If you're interested in learning more, I'll be happy to discuss your specific B2B SaaS go-to-market scenario and determine if and when I can help you achieve your growth goals and objectives.
If you are an executive and would like to learn more about applied Generative AI skills development, explore my concept of a GenAI Exec Academy model that is intended to fuel knowledge transfer.
Contact me, when you’re ready, to schedule a consultation chat.